| Used cars are not as easy to finance as new cars. | | | | 10% is most often required for a used car loan. It |
| Lenders are more hesitant of financing vehicles with | | | | signals to the lender that you are investing in this |
| unknown pasts. However, you can find reasonable | | | | purchase and are willing to make payments. A larger |
| rates on auto loans by lining up your financing before | | | | down payment can improve rates and offset low |
| you go car shopping. A down payment of 10% or | | | | credit scores. |
| more, plus shopping with a car dealer can also improve | | | | Another way to save money is to choose a short |
| your rates. | | | | term loan. Since a used car probably won?t last as |
| Get Financing First, Then Car Shop | | | | long as a new car, five and three year loans make the |
| Pre-approved auto loans have a number of | | | | most financial sense. You save on interest costs and |
| advantages. First, you find out what you qualify to | | | | can start saving for your next car. |
| borrow before you get stuck in a contract. You can | | | | Shopping With A Dealer |
| also play around with loan terms to find a reasonable | | | | Some lenders also offer better rates when you |
| monthly payment. And sellers are eager to close a | | | | purchase through a car dealership, even with used |
| deal with a buyer that has secure financing. | | | | cars. You should weigh all your options when applying |
| Used cars loans often require a slightly higher rate, | | | | for this type of car loan. |
| usually .6 or more, than new car loans. However, rates | | | | Dealerships usually provide a partial warranty for their |
| vary widely between lending companies, so it pays to | | | | used cars; they also charge more. You may be able to |
| shop around. Processing your loan before your car | | | | find an excellent deal in the classifieds, but there is a |
| purchase relieves you from the pressure of signing | | | | level of risk with that purchase. However, the |
| with the first lender you find. It also saves you money | | | | difference in interest rates between these types of |
| in lower rates. | | | | loans is more than 1%. |
| Plan On 10% Down | | | | |